Edit This Favorite

What should we consider when entering a project contract with a code of conduct provision?

Regards, Ethically Aware

Dear Ethically,

Obviously knowing the obligations created by the code of conduct is paramount. Those terms and conditions will set how you should act and what you need to do outside of complying with the code. If you are performing services on a project and the code requires you to admit to any errors or work defects performed by you; you could run afoul of your professional liability insurance policy. Insurance carriers want to know where claims may come from before you admit to any liability. The carrier can argue that you prejudiced their rights by not contacting the carrier first. Additionally, a failure to comply with the code can result in the imposition of fines or the termination of your agreement. Any damages arising from either of those actions are not covered by insurance. As I have previously said, contractual codes of conducts are good but you have to understand the potential consequence of not complying with the code.